Ohio voters have rejected a law that would have stripped teachers of many of their collective bargaining rights, according to results reported by the Associated Press late Tuesday, an outcome that could reverberate well beyond the state’s borders.

The Ohio referendum, known as Issue 2, was perhaps the most closely watched ballot fight of the 2011 election. The target was a law pushed through the state’s GOP-controlled legislature this year with strong Republican support.

The measure had drawn a flood of attention from the media and political activists over the past few months, partly because it was regarded as an important, symbolic fight over collective bargaining and the influence of teachers’ unions and other organized labor groups.

Teachers’ unions spent millions of dollars in an effort to repeal the law, originally known as Senate Bill 5, while business organizations poured money into a defense of the measure. The cash flow financed a wave of televised advertising and other outreach designed to appeal to Ohioans, who are well accustomed to high-decibel political campaigns because of their state’s status as a battleground during presidential elections.

The statute, backed by Republican Gov. John Kasich, would have imposed broad restrictions on public workers’ bargaining powers.

“Those who would dare try to strip collective bargaining rights away from hard-working citizens will now think twice,” Randi Weingarten, the president of the American Federation of Teachers, said in a statement regarding Tuesday’s result. “Ohio voters made it clear to them that there is a price to pay for turning your back on the middle class.”

In school districts, the measure would have blocked bargaining over class sizes, school assignments, and provisions that restrict principals from assigning workloads and job responsibilities. It also would have given school boards broad powers to put in place their final offer in negotiations with unions if the two sides could not come to an agreement.

Additionally, the measure would have forbidden districts from giving preference in layoff decisions to teachers with more seniority, a provision similar to those approved in a number of other states this year, such as Florida and Idaho. The law also would have created a merit-pay system for teachers, though it was unclear how educators’ performance would be judged. A separate law approved by Ohio’s legislature this year also established a performance-pay system, so that pay model appears set to become reality in the state’s schools soon.

Kasich had argued that the law would drive down costs for taxpayers by phasing out expensive concessions made to unions during the negotiating process. His administration had estimated that the law would save local governments, including school districts, more than $1 billion per year by reducing health-care costs and doing away with automatic salary increases.

The Ohio ballot fight emerged just a few months after a similarly frenzied battle played out in Wisconsin.

Wisconsin Democrats pushed for a series of recall elections against Republican lawmakers who supported a measure, backed by Gov. Scott Walker, also a Republican, that stripped teachers and other public employees of many bargaining powers. Republicans, in turn, organized recalls against a number of Democratic legislators. Democrats picked up seats in the state’s Senate during those elections, but not enough to wrest control of that chamber from the GOP.

How Republicans in Ohio respond to Issue 2′s defeat remains to be seen. It’s possible that they could attempt to once again approve some version of a law designed to curb unions’ collective bargaining powers and reduce school district costs—one that could hold up politically.